Outdated railway infrastructure and insufficient quality of services were blamed for the sector’s disappointing performance and failure to catch up with other modes of transport by Hoạch.

“Mounting competition with other modes of transport, the Ghềnh Bridge collapse in Đồng Nai District, sea environment pollution, and storms and floods in the Central region all adversely impacted the corporation’s business. In addition, limited budget for infrastructure development for 2016 delayed the implementation of new projects,” he said.

Nguyễn Ngọc Đông, Deputy Minister of Transportation – also in charge of the VNR’s Board of Directors – said that last year, railway infrastructure didn’t enjoy many upgrades, but restructuring which is expected to rejuvenate its business is scheduled for 2017.

Đông agreed with Hoạch, saying that the Ghềnh Bridge collapse in last year’s March severely disrupted the North-South Railway for three months, affecting both roadway and railway.

This year, the corporation aims for growth of eight per cent or higher in revenues, post-tax profits of VNĐ 138 billion ($6.08 million), 5-7 per cent cuts in railway accidents compared to 2016.

The corporation’s plans to promote its competitiveness, expand railway market share, increase revenues from passenger and freight transportation, find new partners to invest in railway systems and other support facilities like warehouses, freight yard, loading and offloading sites. Automatic barriers on level-crossing will also be installed.

According to Đông, the budget for railway this year stands at VNĐ 2.2-2.3 trillion ($97 million – 101 million). For mid-term capitals, the Ministry of Transport has requested more funding from the state budget for upgrading infrastructure and resolving the sector’s bottlenecks.

“The competition the railway sector has to face will just increase, since growth potential for other transport sectors such as airway, waterway, and road transport remains large,” he said.